Utilities, transmission providers and wind generation developers last Thursday called on FERC to maintain a "sense of urgency" in carrying out reforms to the current process for interconnecting generators to the bulk power grid.
Nowhere are reforms needed more than in the Midwest Independent System Operator (MISO) and the California Independent System Operator (CAISO), they said. The Midwest ISO "is managing 291 active [interconnection] requests, representing 71,372 MW of total generation, of which 55,537 MW is wind generation. Such a queue is unmanageable," said FPL Energy LLC in post-technical conference comments filed at the Federal Energy Regulatory Commission (FERC) [AD08-2].
"The growing bottleneck in the Midwest ISO will continue to hamper the efforts of developers to interconnect viable wind energy facilities to the transmission grid and put the efforts by states to implement their renewable portfolio standards in the Midwest at great risk for the foreseeable future," noted the Juno Beach, FL-based company, a leader in wind energy development.
At a FERC technical conference last month, state regulators, alternative energy developers and power industry officials urged the Commission to fix its queue management process, saying that the current process for connecting to the grid is broken. The existing FERC queue process determines a generator's access to the grid on a "first come, first served" basis.
Industry says the queue lines of transmission providers have become clogged in recent years due to the growing development of renewable fuel generation, constrained transmission capacity, lengthy interconnection studies by transmission providers and the increasing number of "phantom projects" in the queues that are never realized, among other things.
FERC last month pointed out that the unprecedented demand in some regions for new types of generation, principally renewable generation, has placed further stress on the current queue management approach because these generation technologies can be brought on-line more quickly than traditional generation.
FPL Energy asked the agency to adopt short-term reforms to provide a clearer path for greater wind investment, "and only turn to longer term solutions after the short-term solutions are implemented through tariff reforms." It proposes eliminating the need for transmission providers to perform interconnection feasibility studies; establishing milestones for projects to remain in the existing queue; and setting enforceable interconnection timetables.
The Midwest ISO has begun discussing changes to the queue process and intends to make a tariff filing at FERC by June. "FPL Energy urges the Midwest ISO to greatly accelerate this timetable...Such an accelerated process already has been implemented by the California [ISO]," which plans to consider a tariff filing in March.
National Grid USA urged FERC to be careful about the types of reforms that are made. "The Commission should not undertake changes that bypass or cut corners on the necessary engineering that is needed to study interconnections. In fact, the time allotted for initial studies is not really amendable to shortening. Shortening the study timelines will only create less accurate study results, with the chance only to eliminate approximately a month from an otherwise lengthy process," the transmission owner said.
Instead, "there may be constructive ways to expedite the queue process," such as skipping the initial feasibility study and incorporating automatic queue clearing mechanisms. The latter could provide automatic electronic notification of deadlines to developers (with a statement informing them of the consequences of lapsed deadlines) and could remove projects that fail to meet deadlines, National Grid said. "This would clear queues for more active proposals."
The American Wind Energy Association (AWEA) also stressed the urgency for FERC to act on reforms, particularly in the California ISO and Midwest ISO. Both regions should file proposals in the spring, with follow-up Commission action by summer.
"There are large backlogs of interconnection requests around the country. From the wind industry's perspective, many companies are extremely frustrated that the obligations on transmission providers are not being upheld. Studies are being delayed, results in terms of cost assignment are hard to predict, unreasonable requirements are sometimes placed on generators and solvable problems are not being solved in a timely way. The result is that many good projects are unreasonably delayed, harming wind development nationally and harming many states' ability to meet renewable energy goals," the wind energy group said.
AWEA pointed out that queues are in "better condition" in the Electric Reliability Council of Texas Inc. (ERCOT), Wisconsin, Michigan and in non-ISO and non-regional transmission organizations than in the California ISO, most of the Midwest ISO, Southwest Power Pool, PJM Interconnection, the New York ISO and the New England ISO.
The reason is the latter group uses "participant funding" where network upgrades are required to be paid by the generator, the group said. "Participant funding creates a situation where a typical 100 MW, $200 million wind project might face a network upgrade charge of $0 to $30 million with little basis for knowing where in that large range the price tag might fall," it noted.
"ATC (Wisconsin) and ITC (Michigan) recently made short filings to FERC relieving generators of the obligation to pay for network upgrades and now projects are moving forward in those areas. ERCOT has never charged generators for network upgrades. There is no reason why the rest of the country could not follow suit," the AWEA said.
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